Fraud cuffs on owner of daily

Hyderabad, Feb. 14: T. Venkatram Reddy, the owner of Hyderabad-based daily Deccan Chronicle and erstwhile IPL team Deccan Chargers, was today arrested by the CBI on charges of submitting forged share certificates to Canara Bank to procure a loan of Rs 357 crore.

Officials from the CBI's banking security and fraud cell had taken the Deccan Chronicle Holdings Ltd (DCHL) editor-chairman into custody in Bangalore two days ago and had been questioning him, sources said. He was brought to Hyderabad today along with his brother T. Vinayak Ravi Reddy, the DCHL managing director, and arrested around 5pm.

CBI sources said the arrest was in a case of alleged cheating and criminal conspiracy the agency had registered against DCHL in July 2013 based on a complaint from Canara Bank, Bangalore.

After the arrest, the brothers were taken to Osmania General Hospital for a check-up and produced before a magistrate at his residence in Secunderabad. They have been taken back to Bangalore by the CBI team after the magistrate issued a prisoners' transit warrant, police sources said.

Another DCHL official, P.K. Iyer, who is said to wield much influence over the Reddy brothers, has also been arrested.

In 2012, Iyer had gone underground after Karvy Stock Broking Limited filed a criminal case against the Reddy brothers alleging forgery to pledge non-existing shares to Future Group to raise Rs 170 crore.

"He is the brain behind the Reddy brothers taking huge loans from financial institutions by pledging shares and assets," a source said.

Venkatram Reddy has been charged under IPC Sections 420, 120b, 468 and 471 for cheating, wilfully misleading banks and submitting fake documents to procure loans. Between 2009 and 2011, he raised loans of nearly Rs 1,232 crore from various private and public sector banks.

The Reddy brothers have been facing several legal and criminal cases for loan defaults amounting to over Rs 4,000 crore, reports said.

Venkatram Reddy allegedly owes Rs 50 crore to Andhra Bank, Rs 100 crore to Corporation Bank, Rs 50 crore to State Bank of Hyderabad and the rest to other private banks like Axis Bank. Most of his Hyderabad properties, including his Begumpet residence and the Kondapur Press, have been subpoenaed by banks and other financial institutions.